Chowdeck’s Ad strategy grows alongside food delivery success.
Chowdeck has been making headlines for its strategic growth but last week, it made the news for a different reason: its Ad business.
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Chowdeck’s Ad strategy grows alongside food delivery success.
ChopNowNow, shuts down After 6 years, pivots to grocery delivery
How virtual cards are reshaping Africa's economy.
Chowdeck’s Ad strategy grows alongside food delivery success
Founded by Femi Aluko, Olumide Ojo, and Lanre Yusuf, Chowdeck built a robust platform. With a smart approach, user-friendly app, and efficient delivery system, The company has quickly become a major player in Nigeria's food delivery market. While Chowdeck is making headway, other food delivery apps have struggled. Jumia Food and Bolt Food exited Nigeria by the end of 2023, citing issues related to unsustainable costs, fluctuating market prices, and logistical challenges. These exits highlight the difficulties of sustaining operations in this tough market.
But what is Chowdeck doing differently?
One big factor in Chowdeck's success is the great incentives for delivery workers. Delivery workers at Chowdeck earn significantly more than their counterparts at other companies. The food delivery startup also prioritizes customer satisfaction through its user-friendly app, by providing personalized recommendations, real-time tracking and seamless navigation. Their mastery of timely and reliable food delivery, along with quick and great customer service, sets them apart. Their geotagging function predicts the number of riders needed at different times and places, making delivery times faster and more reliable for customers and restaurants.
Strategic partnerships are another key to Chowdeck's success. By working with a range of restaurants, from small food businesses to large chains like Chicken Republic, Chowdeck has expanded its offerings and attracted even more customers.
The latest move from Chowdeck is introducing ads within their app. This new ad structure increases their revenue without extra costs. With advertisements like banners and push notifications, Chowdeck has another revenue stream besides its core business. For instance, Guaranty Trust Bank recently advertised its share offering on Chowdeck's app, showcasing the potential of this new revenue stream. This move demonstrates Chowdeck's ability to adapt and stay ahead of the curve.
ChopNowNow, shuts down after 6 years, pivots grocery delivery.
ChopNowNow, the once-popular food delivery service in Lagos, is planning a comeback focusing on grocery delivery. After six years in the food delivery business, ChopNowNow shut down operations in February 2024. Founder Olamide Olaleye cited thin margins, intense competition, and the challenges of maintaining customer loyalty in a low-trust market as reasons for the closure.
ChopNowNow initially launched in 2018, offering affordable meals with free delivery in Lagos. The company grew rapidly, expanding its delivery fleet from three to thirty bikes within three years. However, rising inflation and increased competition from other food delivery platforms made it difficult to sustain operations.
Olaleye explained that free delivery attracted disloyal customers who would switch to competitors offering discounts. As a result, ChopNowNow's average order value dropped to ₦1,000, and the business struggled to remain profitable.
Learning from these challenges, Olaleye is now focusing on launching a grocery delivery service called ShopNowNow. The new venture will target high-value orders above ₦25,000, allowing for scheduled batch deliveries rather than the immediate delivery model used in food delivery. This approach aims to reduce operational costs and increase profitability.
Olaleye is optimistic about the future of ShopNowNow, despite the competition from well-funded grocery delivery services like GoLemon, PricePally, and Chowdeck. He hopes to carve out a successful niche in the grocery delivery market by targeting larger orders and focusing on efficient logistics.
How Virtual Cards Are Reshaping Africa's Economy
For many years, traditional financial institutions have failed to adequately serve Africans’ needs. Countless individuals have experienced the frustrations of conducting financial transactions across borders, fueled by exorbitant fees, limited access to physical bank branches, and slow service. We have all had a seat at this table. These persistent challenges have hindered economic growth and financial inclusion in the region. However, the introduction of virtual cards emerged as a promising solution, offering a more convenient, secure, and accessible approach to managing money.
Read more about the impact of virtual cards on Africa’s economy in our latest article.
Did you know?
Afrostream aimed to be the Netflix for Africa, offering African, African-American, and Caribbean content. Launched in 2015 with Y Combinator's backing, it garnered early excitement but shut down after just two years.
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